Federal Circuit No. 2014-1391

On December 3, 2014, in Par Pharmaceutical, Inc. v. TWi Pharmaceuticals, Inc., the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit”) vacated the district court’s judgment of invalidity, holding that the district erred in determining inherency in the context of obviousness.

The primary issue on appeal was whether the district court erred in concluding that a certain “food effect” limitation would have been “inherent” in prior art. Par patented a method of using “nanosized” formulations of the known drug “megestrol” based on the reformulation of megestrol by reducing a particle size from micrometer range to nanometer range. The claim at issue requires in particular that there is “no substantial difference” in the absorption of megestrol between the fed and fasted states. Ruling for TWi, an ANDA filer in this case, the district court held the claim invalid as obvious, finding that all the substantive limitations in the claim were disclosed in the prior art and that the “food effect” limitation (“no substantial difference”) was “inherent” in the nanoparticulate formulation.

The Federal Circuit vacated the district court’s inherency determination. After cautioning that the inherency analysis “must be carefully circumscribed in the context of obviousness,” the Federal Circuit set forth the rule that to be inherent, “the limitation at issue necessarily must be present, or the natural result of the combination of elements explicitly disclosed by the prior art.”

The Federal Circuit found that the district court had not required TWi to present evidence sufficient to prove inherency under this standard. It reasoned that the district court ignored the “food effect” limitation of the claim, because there was simply no finding as to whether the claimed food effect limitation was necessarily present in the prior art combinations and because TWi failed to correlate the claimed food effect limitation as naturally resulting from the reduced particle size. The Federal Circuit then remanded the case for the district court to determine if TWi had shown that the food effect as claimed was necessarily present in the prior art combination.